Ch.7 · NAV Calculation Rules · medium
What is the 'SIP instalment unit allotment' process?
0% of students got this wrong
EXPLANATION
Each SIP instalment is treated as a fresh purchase. Units are allotted at the applicable NAV for that specific instalment date — based on whether the debit and credit happen before or after the cut-off time. Since SIP dates are fixed (e.g., 5th of each month), each month's allotment is at that date's NAV. This creates the rupee cost averaging effect as NAVs vary each month.
Practising Chapter 7 one question at a time?
Try the full chapter — 80 questions, tracked score, weak area breakdown.